An increase in the demand for organic foods will lead to:

Question

Quizplus · Accepted Answer

An increase in demand for organic foods will lead to an increase in the price of organic foods, as suppliers will want to take advantage of the increased demand by raising prices. This increase in price will, in turn, increase the quantity supplied of organic foods, as suppliers will want to produce more of the product to take advantage of the increased profit margins. Therefore, the answer is an increase in the price, and hence an increase in the quantity supplied of organic foods (option B).

An Increase in the Demand for Organic Foods Will Lead